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There may be all kinds of reasons you need a 2^nd mortgage in Toronto. Many people take them out in an effort to consolidate debts. Another very common reason for a second mortgage is for the sake of financing home improvements. Perhaps you need to cover a portion of the down payment on your original mortgage to avoid incurring the property mortgage insurance (PMI) requirement.

Whatever the case, second mortgages – which also use your home as collateral – generally carry a higher interest rate than the original. Lenders will look at your current credit rating, but they’ll also come up with a figure based on the current level of equity you have in your home. This is the difference between the current value of your home and the amount that you still owe on it.

As you can probably imagine, every lender is going to come up with slightly different interest rates for that second mortgage even though they’re basing this decision on the same objective numbers. This is why it’s so important that you explore every option out there. A second mortgage without favorable terms is going to make your future difficult.

How long it takes you to pay off this second mortgage will depend mostly on the sum you borrowed. The terms may last for as little as a year or as long as 20. Of course, the shorter the loan is for, the more you’re going to be paying per month. You don’t want to agree to a short loan simply because it seems easier to pay off only to realize it will put you under financial stress.

Let Mortgage Captain help you find a lender who will work with you and your situation. Call us today at 613-296-3892 to learn more.